Conceptual Framework of Financial Reporting (IFRS) Flashcards
True or False: The IASB framework should only apply to public companies, not private corporations.
False. The IASB Framework should apply to both public and private companies.
What elements are considered income under the FASB framework?
“Revenue” and “gains”
Does the IASB framework include losses for the term “expense”?
Yes, it includes such losses.
What compromises income under the IASB framework?
Includes both revenue and gains.
What elements of the FASB framework are not included in the IASB framework?
Investments by owners, distributions to owners, comprehensive income, gains, losses.
What are some of the purposes of the IASB framework?
Assist the Board to develop new International Accounting Standards (IASs); promote harmonization of standards; and assist, provide information to interested parties.
What is meant by “a reliable measurement?”
Measurement in which a reasonable estimate is made.
What will be the underlying conceptual support for future principles-based accounting standards?
Developing a common framework.
When is an expense immediately recognized?
When no future benefit qualifying as an asset is present.
When do you recognize an element in the IASB framework?
When it is possible that there is a future economic benefit and the item has a cost of value that can be measured with reliability.
What are the underlying assumptions of the IASB framework?
The financial statements are prepared on the accrual basis and the entity is a going concern.
What are the five elements in the IASB framework?
(1) Assets
(2) Liabilities
(3) Equity
(4) Income
(5) Expenses
True of False: Income may be realized or unrealized.
True.
